Hall v. Rag-O-Rama, LLC

• Decision Date: 05 May 2020
• Docket Number: CIVIL ACTION NO. 18-12-DLB-CJS
• Parties: SALLY HALL PLAINTIFF v. RAG-O-RAMA, LLC DEFENDANT
• Court: U.S. District Court — Eastern District of Kentucky

SALLY HALL PLAINTIFF v. RAG-O-RAMA, LLC DEFENDANT

CIVIL ACTION NO. 18-12-DLB-CJS

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF KENTUCKY NORTHERN DIVISION AT COVINGTON

May 5, 2020

MEMORANDUM OPINION AND ORDER** ** ** ** ** ** ** **

This matter is before the Court on Defendant's Motion for Summary Judgment.¹ (Doc. # 53). The Motion has been fully briefed, (Docs. # 64 and # 71), and is now ripe for the Court's review. For the reasons set forth herein, the Motion for Summary Judgment is granted in part and denied in part.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

This case arises from the termination of Plaintiff Sally Hall from her employment with Defendant Rag-O-Rama, LLC ("ROR") in January of 2017. See generally (Doc. # 6). Hall was previously employed by ROR from 1999 to 2003. (Doc. # 64-1 at 2). Hall claims that Vance Whitener, the CEO of ROR, later recruited her to return to ROR. (Doc. # 52 at 22:7-18, 31:24-32:11). While living in Kentucky and working simultaneously for Elizabeth Cole Jewelry ("ECJ"), Hall accepted a position to work for ROR as a part-timeTrainer on August 21, 2015.² (Docs. # 52 at 29:20-30:3 and # 64-1 at 2). Hall was paid $18,000 and received health-insurance benefits for her part-time work at ROR. Id.; see also (Doc. # 52 at 31:7-15). As a part-time Trainer, Hall made "occasional trips to the Columbus [Ohio] store." (Doc. # 64-1 at 2); see also (Doc. # 65 at 109:17-20) (Whitener explaining that his expectations were for Hall to be in Columbus for whatever time "it took to get everybody trained up"). In June of 2016, Hall left her position with ECJ and accepted a full-time position with ROR as an Area Manager. (Docs. # 13-1 at 3 and # 52 at 13:18-19, 15:21-24); see also (Doc. # 6 at ¶¶ 9, 11). Hall served as Area Manager for ROR from June 13, 2016 until she was terminated on January 10, 2017. (Doc. # 13-1 at 3).

Whitener claims that he was reluctant to hire Hall for either position at ROR because she would be working remotely from her home in Falmouth, Kentucky. (Doc. # 65 at 106:11-17, 107:20-108:9). He also claims that Hall's performance as a Trainer was lacking, which made him additionally hesitant to hire her for a larger role. Id. at 116:13-117:14. Hall disputes this, however, claiming that Whitener initially "was begging and doing whatever he could to persuade her" to come back to work for ROR when she was hired as a part-time Trainer, (Doc. # 64 at 3), indicated that "he was extremely pleased with [Hall's] part-time efforts," (Doc. # 64-1 at 2), and "persuaded [her] to leave [ECJ] and come back to Rag-O-Rama full time," (Doc. # 52 at 15:23-24).

Hall claims that Whitener also made a number of promises to entice her to accept the full-time Area Manager position with ROR. (Doc. # 64-1 at 3). In addition to the salaryand other benefits listed in her employment agreement, she claims Whitener promised her a $5000 payment for design work she completed for ROR during her initial employment with the company (between 1999 and 2003), id., and a company car "once [she] was able to take on more than the Columbus store," (Doc. # 52 at 37:13-19). She also claims that it was promised that she would oversee the franchising of ROR and receive some sort of ownership interest in ROR once the company was franchised. (Doc. # 52 at 35:1-11) (explaining that she was not going to be an owner of a franchise, but a part-owner of the ROR company); (Doc. # 64-1 at 3) (explaining that she "would be co-owner with him in those franchises"). Finally, Hall claims that Whitener promised she would be made executor of his will. (Doc. # 52 at 37:13-19); (Doc. # 64-1 at 3). Hall also believed that, under her employment agreement, she would be "guaranteed one year's salary and benefits if terminated." (Doc. # 64-1 at 3).

Upon accepting the Area Manager position, Hall signed an employment agreement, labeled as a "Communication Form," which documented her pay and benefits as well as some of her responsibilities as an employee of ROR. See (Doc. # 52-1) (laying out benefits and explaining that Hall was "expected to work on average a 40+ hour work week" and "agree[d] to uphold all company policies as outlined in the Employee and Manager Handbooks . . . [and] to perform the Area Manager's job duties as outline[d] in the handbooks, training materials and by his/her supervisors."). Id. The Form also included reminders about the importance of confidentiality and about ROR's non-compete policy. Id. With regard to the non-compete policy, the Communication Form states:

He/she is reminded of the non-competition clause guidelines, as well as, obligating associate managers and higher to one full year of employment on the management team at Rag-O-Rama. If the one full year is not met, any benefit, including but not limited to used PTO, will be reversed/paidback to Rag-O-Rama. If a manager separates from the company, they are prohibited from working for a direct competitor for two years.

Id. The non-compete language in Hall's Communication Form, mirrored the language in the Communication Forms of other ROR managers.³ See (Doc. # 53-3) (Communication Forms promoting Phil Gasper to Associate Manager, Assistant Manager, and Store Manager which all indicate that as a manager he is obligated to "one full year of employment on the management team at Rag-O-Rama" and if he "separates from the company [he is] prohibited from working for a direct competitor for two years"); (Doc. # 53-4) (Communication Forms promoting Leigh Trainor, Danielle Hess, and Corey Montgomery to Assistant Manager positions, which include similar non-compete language). Hall signed the Communication Form on June 14, 2016. Id.

As an Area Manager, Hall's main responsibilities were to manage the ROR store in Columbus, Ohio and revise ROR's Employee Handbook and other training materials. (Docs. # 13-1 at 3 and # 65 at 117:15-21). More specifically, all Area Managers at ROR are responsible for the following, among other things: working with and supervising store managers and assistant managers; store operations including hiring, training, and evaluations; executing major maintenance requests; reviewing the store schedules and floor plans; maintaining budgets; adhering to and upholding company policies; handling complaints; maintaining inventory; and working to maximize store sales. (Doc. # 53-12). In addition, Hall had been given a list of specific issues that needed to be addressed at the Columbus store. (Doc. # 53-11). According to Hall, she primarily undertook her responsibility to manage the store "remotely by video feed and through email andtelephonic communications from her residence in Falmouth, Kentucky" but also "made occasional, planned and surprise visits to the Columbus, Ohio store." (Doc. # 6 at ¶ 20).

Approximately ten weeks into her full-time employment as an Area Manager, Whitener completed Hall's three-month employment review. (Doc. # 52-8). Hall also completed a self-assessment of her own progress as Area Manager around the same time. (Doc. # 52-7). Hall did not see or discuss her three-month review with Whitener until after she completed her self-assessment. See (Doc. # 65 at 144:21-145:5) (Whitener explaining during his deposition that he completed the three-month review on August 31 but did not deliver it to Hall until September 11).

The three-month review provided Hall with "some feedback and a plan to help [her] succeed in [her] position." (Doc. # 52-8 at 1). In fact, through the review Whitener gave quite a bit of feedback regarding Hall's work up to that point. Many of his comments dealt with Hall's remote work. For example, Whitener noted that Hall was "not available for the business needs as much as [he] would like," was hard to reach at times, and appeared to not be "watching the cameras as much as [she should]." Id. at 1, 3. He also stated that it would be "so beneficial to [Hall's] new team" if she could spend more time in the store and expressed concern that she was "still struggling to [run the Columbus store remotely] successfully." Id. at 4-5. Additionally, he stressed, among other things, the need for store schedules to be out three weeks in advance, for Hall to show progress on training employees, and for hiring to improve. Id. at 2, 4. He also, however, noted some positive aspects of Hall's work, including having the "Biggest Dollar Sale ever," setting up the new office and break room, and showing some improvement in her monitoring of the cameras and her availability. Id. at 1, 4, 5. Whitener delivered the three-monthemployment review to Hall and she signed it on September 11, 2016. (Docs. # 52 at 83:13-15 and # 65 at 144:21-145:2).

Prior to reviewing her three-month feedback with Whitener, Hall completed her own self-assessment of her work up to that point, which she emailed to Whitener on September 3, 2016. (Doc. # 52-7). Her self-assessment included a list of her achievements, under-achievements, places for improvements, and goals for her employment. Id. Hall's self-assessment, despite being completed before reviewing her three-month review with Whitener, included similar issues to those noted by Whitener. Compare (Doc. # 52-7), with (Doc. # 52-8). For example, in her list of under-achievements Hall included: "learning opening/closing paperwork on new system" and "checking cameras and computers every morning." (Doc. # 52-7). For improvements she lists: "[w]atching the cameras more [f]requently," and "[b]eing readily available at all times to intercept any calls from store from home office." Id. Despite these similarities, Hall claimed during her deposition that she disagrees with many of Whitener's "opinion[s]" and statements in the three-month review. (Doc. # 52 at 83-119) (Hall discussing the three-month review during her deposition); see also id. at 119:2-5 (when asked "So you agree that Vance asked you to improve in some specific areas as part of this three-month review?" Hall answered, "He definitely had opinions on these.").

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